Analysis of macroeconomic reports:

There's a full plate of macroeconomic events slated for Wednesday, and there are quite important events among them that have the potential to influence the movement of both currency pairs. Let's delve into them.

The EU is set to release the retail sales report for January. Most likely, the value of this report will be below the forecast, so the euro is unlikely to receive support. In any case, given the current market volatility, we can expect a movement of a maximum of around 20 pips.

Meanwhile, the U.S. will release two key reports. The ADP report exhibits a tight correlation with the NonFarm Payrolls data, but less significant. It reflects the number of new jobs created in a month. Despite being less important than the NFP, it may still trigger a market reaction. The second report is JOLTs, which reflects the number of job openings on a specific date. It also indicates the state of the U.S. labor market. Stronger values may provide support to the U.S. dollar.

Analysis of fundamental events:

Among the fundamental events of Wednesday, we can highlight the speech of Federal Reserve Chair Jerome Powell. We believe that Powell's rhetoric will not change compared to his previous speeches, as there has been no new macroeconomic information since his last speech that could affect his stance on monetary policy. However, Powell can always surprise the markets, so you may take cues from this event.

General conclusion:

Today, we advise you to focus on the U.S. reports and Powell's speech. Of course, there is a possibility that Powell may not share any important information, and the reports could also turn out to be neutral. In that case, the market may have a minor reaction, and both currency pairs will avoid significant price changes. However, there is still a chance of seeing a strong movement today, higher than what was observed yesterday or the day before.

Basic rules of a trading system:

1) Signal strength is determined by the time taken for its formation (either a bounce or level breach). A shorter formation time indicates a stronger signal.

2) If two or more trades around a certain level are initiated based on false signals, subsequent signals from that level should be disregarded.

3) In a flat market, any currency pair can produce multiple false signals or none at all. In any case, the flat trend is not the best condition for trading.

4) Trading activities are confined between the onset of the European session and mid-way through the U.S. session, after which all open trades should be manually closed.

5) On the 30-minute timeframe, trades based on MACD signals are only advisable amidst substantial volatility and an established trend, confirmed either by a trendline or trend channel.

6) If two levels lie closely together (ranging from 5 to 15 pips apart), they should be considered as a support or resistance zone.

How to read charts:

Support and Resistance price levels can serve as targets when buying or selling. You can place Take Profit levels near them.

Red lines represent channels or trend lines, depicting the current market trend and indicating the preferable trading direction.

The MACD(14,22,3) indicator, encompassing both the histogram and signal line, acts as an auxiliary tool and can also be used as a signal source.

Significant speeches and reports (always noted in the news calendar) can profoundly influence the price dynamics. Hence, trading during their release calls for heightened caution. It may be reasonable to exit the market to prevent abrupt price reversals against the prevailing trend.

Beginners should always remember that not every trade will yield profit. Establishing a clear strategy coupled with sound money management is the cornerstone of sustained trading success.